Check it on the grass root level first and then apply it on an international level
Act like a pirate on the internet and make money. We are not talking about hacking or any other means that can be considered as unlawful, we are talking about the acts of piracy on the internet. Let’s first check the methods of the crime done by a gang of pirates. Pirates always strike in “No Men’s sea.” It means that they cater to a place in a sea which is under no one’s control (Harkristuti Harkrisnowo, 2017). Now let’s draw a comparison and compare No men’s sea with internet in a globalized world. Suppose someone is placing something on a website while sitting in UAE. He is uploading a pirated version of an unreleased Hollywood film. An unreleased film of Hollywood is not a subject of illegitimate business in UAE. However, if he will do the same thing from an IP address that belongs to the USA then it is a crime. They can book the person and punish him as per the recommendations of the federal law. At the most count, they can restrict the access of that particular URL in the USA.
This impairment of the legal systems is opening a window for the cybercriminals across the world. The ethical practices are bringing in a parity of thoughts and practices among the businesses and paving a way towards the global corporate village (Linda K. Trevino, 2016). Many corporate criminals are justified in their acts because they are not troubling the law of the land where they are living. On the other hand, it can become a big headache for another country. Think about a banned herb for the reason of substance abuse. The ban on marijuana is a subject of the country. Its status may vary from country to country. Any person can publicize marijuana in a country where there is no ban on it. With the help of this advertisement, he can create a network for smuggling and create an international empire out of it.
Now think about the corporate corridors once again, after the practice of globalization the stakes are certainly getting bigger. This imparity of the law has all the good reasons to attract corporate citizens to commit some white collar crimes. We are aware that it is always difficult to bring a white collar criminal under the book because of the sophisticated nature of the crime. The practices of globalization are adding another security layer for the employees that are seeking to form a white collar crime (May 2012).
When law fails then the fear of unseen walks in to salvage the situation, this is why authorities across the world are now looking up to practice better value systems and come up with some moral models to motivate their employees and convert them in to corporate citizens with high moral values and high ethical values (A.C.Fernando, 2012).
Author J.S.Chun in his paper “How does corporate ethics contribute to firm financial performance? (2013)”, comprehensively covered this topic. He diagnosed the problem of dishonesty and lack of the ethics to its very core and came up with some solutions that can be considered as grass root solutions to solve the problem. He established a hypothesis of the ethical framework and tried to connect it with the financial performance of any given organization (Schultz, 2009).
In the current essay, we are discussing some of his observations and insights connected to the issue, apart from it we will also check the worth of the proposition that this paper makes. This paper advocate that corporate ethics has the power to contribute to the financial performance of any institution in a globalized world where inter-country trading is rampant and businesses are finding new ventures (Karl Homann, 2016).
In order to understand the nature of the corruption and its impact on the performance of any given organization, we are required to check certain facts at the grass root level of the interface. Ethical practices in an organization ensure that an organization is scoring well at the scale of organizational commitments (Bhandari, 2013). In a globalized world where a business owner is trying to win a trust level in the market, the performance on the scale of organizations commitment is very important. Think about a leather jacket maker stationed in Germany. When he was doing business in Germany he was catering to a selected market with calculating demands (S.D.Chamola, 2017). In a globalize world he can cater to the far-off countries and practice an economy of scale. Just like a real-world market, client hunting is a difficult job in the international market as well. One has to convince a person with the help of some intangible tools like communication skills and presentation materials. During the first stage of the deal sometimes junior level representatives go overboard and make some tall claims. They try to create a catch, the internet brings down the physical efforts of a client handling exercise and words become the ultimate tool. A tall claim ends up in no deal and a loss of organizational commitment. Trustworthiness on this scale can create a sustainable marketing system for the company and increase its performance. Author J.S.Chun( 2013) expressed his concerns & tried to establish certain facts and practices with the help of small firms where we can study the impacts of simple unethical practices.
This paper also presents a breakdown of the process of the moral practicing and ethical behavior. The norms for the ethics set by organizations have a direct impact on the ethical behavior of an employee. We can understand it even better with the help of an example set by the German income tax department. Until 1990, German tax authorities were counting the bribes given to the overseas players as an expense done by the German company in order to match the steps with the international practices. Indeed the definition of the corruption may vary from country to country (Eugene F. Brigham, 2012). While dealing with global forces and international trade communities companies try to compromise on some set standards of the corruption and send wrong messages to their employees. The moment we start looking at the bigger picture this sum of various commitments done by the people working in the organization gets the term of OCB or collective organization Commitment, this collective organization commitment plays a vital role in the case of earning a credibility in the market (Lawrence J Gitman, 2017). We should never forget the fact that we are living in a digital world. Every commitment made by an organization is on the record, the collective term for these communications is also known as digital footprints.
Most of the platforms where this trading is taking place also provide an option to write a feedback towards the end of the deal. Consistent negative feedbacks always have the power to disrupt the performance of the company on the OCB scale and bring its ranking down (Crotty, 2017). The days for the behind the curtain deals are over, data connected to the bids and other details of a deal is freely available. The primary promise of an internet-based platform is to ensure a perfect competition market. When an organization is moving in a perfect competition market then the fair play trophy also matters a lot.
Social exchange is another term that we need to understand, travel back in time and check the heads of the business decision makers (VERSCHOOR, 2016). They were relying on media reports to make prima facie opinions. For the confirmation of the opinion, they were searching for the right people and checking the word of the mouth connected to the deal. Later on, they were employing certain other means to cross-check their decisions. Author J.S.Chun (2013), gave us a clear path where we can connect the performance of an organization on the OCB scale and directly connect it to the financial performance of the organization (Buck, 2018). Internet facilitated a globalized world because they come up with some platforms where a decision maker can check the flow of the word of mouth. Many independent platforms are available where they are giving a ranking to various business operations. It has been observed that an organization with a better score on the ethical rankings is doing a sustainable business (J.S.Chun, 2013). The OCB of an organization can be divided into two parts, the first OCB is an outcome of the efforts of the organization in imparting ethical values in the employees or the corporate citizens, and the second value is connected to the value of the ethical performance of the employees on their own. Author J.S.Chun( 2013) created a hypothesis where he placed financial performance as the sum of both this OCB. In his findings, he observed that the result of the financial performance is indirect, it means that many other factors can also come into the play.
The ethical practices of an organization can be divided into two more fractions, first is internal ethics and the second is external ethics. Internal ethics are the ethics where the members of the organization are playing as a team and interacting with each other on an interpersonal level. External ethics are the ethics when they are competing in an industry sector and battling it out on the ethical standards of the industry where a perfect competition is prevailing. Quite surprisingly the findings of this report focus more on internal ethics. It also means that internal collective processes are more important.
Conclusion
We started this essay on a note where we were trying to find an answer to the question related to the corporate ethics and financial performance of a business. We took a resort in a research published by Author J.S.Chun. This report has a great relevance for the future researches; however, it fails to answer to question at a satisfactory level. The modules of the global business are changing drastically. Most of the governments are now preparing for some economic arrangements that can be termed as free skies. The basic overview of the globalized market gives us an idea that ethical values play a crucial role in the business decision making when a business entity is judging another business entity from a far off place. Various internet platforms are coming up with scales and forums where business owners can express their happiness or unhappiness with any given business. Ethical values play a crucial role in the brand positions of a business. The current research is moving on the right lines but it fails to substantiate the conclusion under its own framework. The report says that OCB connected to the internal ethics plays a vital role, whereas in the current world OCB’s connected to the external world is equally important.
It is the era of the emergence of a new corporate world where the days of major entry barriers are over. On the note of conclusion, we can always say that in the current globalized world fair play trophies of good ethical practices won by the corporate firms can make an impact on their financial performances. The current report focuses more on the internal ethics, however, a general observation of the ever-changing markets gives us an idea that external ethics of an organization are equally important to their financial performance.
A.C.Fernando. (2012). Corporate Governance: Principles, Polices and Practices, 2/e. Mumbai : Pearson Education India .
Bhandari. (2013). Strategic management: A Conceptual Framework. New York: McGrew Hill.
Buck, G. (2018). Treasuring Reputation. Global Finance, https://www.gfmag.com/magazine/september-2018/treasuring-reputation.
Crotty, A. (2017). Ethics and profits do mix. Business Day, https://www.businesslive.co.za/bd/business-and-economy/2017-09-12-financial-gain-tops-doing-the-right-thing-new-survey-shows/.
Eugene F. Brigham, J. F. (2012). Fundamentals of Financial Management. Boston: Cengage.
Harkristuti Harkrisnowo, H. J. (2017). Law and Justice in a Globalized World. Florida: CRC Press.
J.S.Chun. (2013). How Does Corporate Ethics Contribute to Firm financial performance? Journal of Management, https://www8.gsb.columbia.edu/cbs-directory/sites/cbs-directory/files/publications/Chun%2C%20Shin%2C%20Choi%20%26%20Kim%202013%20JOM.pdf.
Karl Homann, P. K. (2016). Globalisation and Business Ethics. Abingdon: Routledge.
Lawrence J Gitman, R. J. (2017). Principles of Managerial Finance. London: Pearson Education.
Linda K. Trevino, K. A. (2016). Managing Business Ethics: Straight Talk about How to Do It Right. New Jersey: Wiley.
May, S. (2012). Case Studies in Organizational Communication: Ethical Perspectives and Practices. Thousand Oaks: Sage Publication.
S.D.Chamola. (2017). Applied Ethics: Some Dimensions. New Delhi: Studera Press.
Schultz, R. A. (2009). Information Technology and the Ethics of Globalization. Hershey: IGI.
Verschoor, C. C. (2016). Six Unethical Practices That Need To Stop. Strategic Finance, https://sfmagazine.com/post-entry/march-2016-six-unethical-practices-that-need-to-stop/.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
